Admit it. How long did you spend deliberating which bank to trust with your hard-earned euros? Did you compare interest rates, fixed charges, the price of a standing order? Or did you go for the bank closest to your house, the one your employer or partner uses, or the one with the flashiest gimmicks?
When it comes to banking, many people are not the rational, well-informed consumers they are when buying other services. The terminology, calculations and seemingly infinite variables can be daunting all the more so when they are in a foreign language. A commercial bank is a retailer, but gets away with much more than a normal shop because many people fail to check their receipt (bank statement), nor do they window shop (compare the financial products on offer).
It is difficult to shake the feeling that banks are so big and powerful that the individual customers opinion doesnt count. Maurizio Sella, head of the Associazione Bancaria Italiana (ABI), says this is not the case. According to him, if customers are unhappy they should change banks, thereby encouraging competition. However, consumer rights organisations argue that high closure costs make this difficult. In fact, the one-off cost of closing a bank account is probably worth it if it means moving to a bank you are happy with, but to do that you need to be clear about what is on offer and what your needs are.
Banks usually have a range of financial packages to suit different types of customers. These deals can be confusing because they are often padded out with irrelevant extras, such as discounts for shops and travel vouchers. Cut through the hype and focus on what really matters in a current account:
Annual fixed charge (canone annuo). This is usually debited monthly, and may include other charges (eg. direct debit card). Some packages contain no fixed charge, in which case the bank will make up for it elsewhere.
Transaction charges (operazioni / riga di scrittura). This is what the bank charges you for each transaction, meaning every entry on your bank statement, whether its a withdrawal, a deposit or a card payment. Many packages include all or a certain number of transactions for free (in franchigia).
Active interest rate (tasso attivo / creditore). This is the amount of interest you get paid on the money you have in the account. In Italy it is now usually less than one per cent. The interest earned is taxed.
Passive interest rate (tasso passivo / debitore). This is the amount of interest you are charged if you go overdrawn. Graduates from the United Kingdom used to free overdrafts on student bank accounts beware: going into the red in Italy will cost you up to 15 per cent.
Bancomat / credit card costs. Many Italians have a Bancomat card, a direct debit card rather than a credit card. The Bancomat allows you to withdraw cash at automatic teller machines (ATMs), to pay in most restaurants and shops, and even to pay bills at some ATMs. For Bancomat and credit cards there is an annual charge, which is sometimes included in the annual fixed charge (see above), plus fees if you lose the card.
Charge for withdrawal from other banks cash points. Banks usually charge extra if you withdraw cash from another banks ATM, on average in the region of 1.40. Doing this is more expensive than it seems because your account is debited four times: for the amount withdrawn, for the commission and then for the transaction charges for both of those debits.
Closing fees. It is useful to know how much it would cost to close the bank account if you decide to take your business elsewhere. Usually the fee is not more than 50.
There is also a fixed government tax of 25.56 per year, and a charge for the quarterly bank statement (estratto conto trimestrale), usually about 15. Depending on your needs, it might be worth finding out how much it costs to have a cheque book (libretto di assegni), to transfer money (bonifici), for a standing order (ordine permanente di pagamento) and for the direct payment of bills (bollette domiciliate).
Armed with this information from a few banks, you need to figure out what your regular monthly transactions are likely to be: depositing your salary, a standing order for the rent, utilities bills payments every two months, cash withdrawals, and so on. Once you know how you plan to use your bank account, you can easily calculate which one is cheapest for your needs. As a foreigner, to open a bank account you need a codice fiscale, a permesso di soggiorno and usually proof of employment such as a pay slip.
If this is still too complicated, then maybe the zero interessi, zero spese account is more attractive, though not all banks offer these. They are just what they say the bank doesnt pay you interest, you dont pay the bank any charges. There are a few provisos, namely that for some there is a charge for cards, and that you do have to pay the annual government tax, or there might be a limit on the number of free transactions. These accounts are offered to get clients hooked so they will invest in more elaborate financial products.
On-line banking is still an emerging sector in Italy, with higher active interest rates to attract new clients. The auxiliary e-banking facility of traditional bank accounts often only allows you to check your balance rather than carry out transactions, but web-based banks, usually linked to real banks, have all the resources of a regular current account, plus on-line trading facilities.
Like it or not, there arent many alternatives to using a bank. The Banca Etica claims to provide a conscientious and transparent banking service and is used by many voluntary and social service groups, but the only real escape from the bank is the post office. Bancoposta is alone in not having increased its fees recently, and has an extensive, nation-wide network. The main advantage is simplicity: there is only one type of account, and all transactions after the first 60 per year are free.
Making sense of an Italian bank statement
data valuta The day on which you make a transaction; this is the day from which the interest is running for or against you.
data contabile The day the bank actually does what you told it to do on the data valuta. There is usually a discrepancy of a few days between the two.
movimento dare Debits to your account
movimento avere Credits to your account
causale The description of the transaction.
riassunto scalare The summary at the bottom of a quarterly bank statement telling you how much youve earned from the bank: active interest rate payments minus passive interest rate costs and charges.